Head of Apple Leisure Group says insecurity, sargassum and insufficient marketing are the causes.
Mexico’s high-end tourism market has taken a hit so far in 2019, according to the CEO of a hospitality-travel firm who predicts that visitor numbers will decline further in coming months.
Alejandro Zozaya, CEO of Apple Leisure Group, estimates that the economic spillover from tourism is down 20% to date this year compared to the same period of 2018.
The problem: not as many wealthy Americans are coming to Mexico to vacation, get married at lavish ceremonies and honeymoon.
“The most important market we have lost is that which leaves the largest economic spillover, the high-end North American,” Zozaya told the news outlet Aristegui Noticias.
“We still have a lot of Americans but the highest segment [of the market] has stopped coming and we’ve replaced them with tourists from other countries and regions who leave a smaller spillover – they spend less at the destination, hotel rates go down,” he said.
The businessman claimed that the main reason well-off tourists are not coming to Mexico is insecurity but added that sargassum on Caribbean coast beaches and a lack of marketing following the government’s decision to disband the Tourism Promotion Council (CPTM) are also factors.
More United States citizens are traveling outside their country than ever before and there is not a decline in the international tourism market, but tourists are deciding to “go to other destinations that are not Mexico,” Zozaya said.
“[Americans] are going to the Dominican Republic, Costa Rica, Jamaica, and Mexico loses market share.”
He said that tourism is declining in Mexico’s most popular destinations at the same as the number of hotel rooms is going up.
“We have 30,000 additional rooms projected for Quintana Roo on top of those in Puerto Vallarta, in Los Cabos and other destinations in Mexico,” Zozaya said.
He stressed that advertising is the best way to attract greater visitor numbers to Mexico and that demand for accommodation and other tourism services must grow at a rate at least equal to supply growth in order to maintain profitability and employment in the sector.
Zozaya’s estimate of a 20% reduction in tourism spending this year is well above the 0.3% decline in air arrivals recorded in January but the businessman warned that “the most complicated” period for the tourism industry “is still to come.”
Contributing to the decline in international air arrivals in January was a reduction in the number of passengers flying into Cancún International Airport, the first year-over-year decrease for any month in almost seven years.
Earlier this year, the Secretariat of Tourism predicted that international visitor numbers could hit 43.6 million in 2019, which would represent a 5.2% increase on last year’s record figures.
Total tourism expenditure is forecast to reach just under US $23.7 billion, which would also be 5.2% higher than in 2018.
Last month, Tourism Secretary Miguel Torruco Marqués said the government is aiming to increase expenditure by tourists in Mexico by focusing more on attracting big spenders.
Among the nationalities that spend the most while visiting Mexico, the Japanese are in first place, spending an average of $2,008, not including airfare.
Jim Hepple is an Assistant Professor at the University of Aruba and is Managing Director of Tourism Analytics.